Masco Corporation Reports Fourth Quarter and 2019 Year-End Results

2019 Fourth Quarter Key Results

  • Sales for the fourth quarter matched prior year at $1.6 billion; in local currency, sales increased 1 percent
  • Earnings per share from continuing operations for the quarter decreased 2 percent to $0.56 per share; adjusted earnings per share from continuing operations matched prior year at $0.54 per share
  • Returned $495 million to shareholders through share repurchases and dividends in the quarter
  • Anticipate 2020 earnings per share from continuing operations to be in the range of $2.25 - $2.45 per share, and on an adjusted basis to be in the range of $2.35 - $2.55 per share
  • Windows and Cabinetry businesses accounted for as discontinued operations

 

LIVONIA, Mich.--()--Masco Corporation (NYSE: MAS), one of the world’s leading manufacturers of branded home improvement and building products, reported its results for the fourth quarter and full year of 2019.

2019 Fourth Quarter Commentary

  • On a reported basis, compared to fourth quarter 2018:
    • Net sales matched prior year at $1.6 billion; in local currency, net sales increased 1 percent
    • In local currency, North American sales increased 1 percent and international sales decreased 1 percent
    • Gross margin decreased 20 basis points to 34.5 percent from 34.7 percent
    • Operating margin decreased 130 basis points to 15.6 percent from 16.9 percent
    • Net income from continuing operations was $0.56 per share compared to $0.57 per share
  • Compared to fourth quarter 2018, results for key financial measures, as adjusted for certain items (see Exhibit A) and with a normalized tax rate of 26 percent, were as follows:
    • Gross margin decreased 40 basis points to 34.6 percent from 35.0 percent
    • Operating margin decreased 150 basis points to 15.7 percent from 17.2 percent
    • Net income from continuing operations matched prior year at $0.54 per share
  • Liquidity at the end of the fourth quarter was $1,697 million (including availability under revolving credit facility)

2019 Fourth Quarter Operating Segment Results

  • Plumbing Products’ net sales increased 2 percent (3 percent in local currency) driven by 5 percent growth in North America
  • Decorative Architectural Products’ net sales decreased 3 percent, with growth in paints and other coating products offset by lower sales in lighting

“We finished the year on plan, with solid growth in both North American plumbing and paints and other coating products,” said Keith Allman, Masco’s President and CEO. “We also closed the sale of our Milgard Windows and Doors business, signed an agreement to sell our Masco Cabinetry business, and returned $495 million to shareholders through share repurchases and dividends during the quarter.”

2019 Full Year Key Results

  • Sales for the year increased 1 percent to $6.7 billion; in local currency, sales increased 2 percent
  • Operating profit grew 1 percent to $1,088 million; adjusted operating profit decreased 1 percent to $1,110 million
  • Returned over $1.0 billion to shareholders through share repurchases and dividends
  • Earnings per share from continuing operations for the year grew 7 percent to $2.20 per share; adjusted earnings per share from continuing operations grew 6 percent to $2.25 per share

2019 Full Year Commentary

  • On a reported basis, compared to full year 2018:
    • Net sales increased 1 percent to $6.7 billion
    • In local currency, North American sales increased 2 percent and international sales matched prior year
    • Gross margin increased 40 basis points to 35.4 percent from 35.0 percent
    • Operating margin matched prior year at 16.2 percent
    • Net income from continuing operations increased 7 percent to $2.20 per share compared to $2.05 per share
  • Compared to full year 2018, results for key financial measures, as adjusted for certain items (see Exhibit A) and with a normalized tax rate of 26 percent, were as follows:
    • Gross margin decreased 20 basis points to 35.5 percent from 35.7 percent
    • Operating margin decreased 40 basis points to 16.5 percent from 16.9 percent
    • Net income from continuing operations increased 6 percent to $2.25 per share compared to $2.13 per share

“2019 was a transformative year for Masco,” said Allman. “We executed on our strategy to become more focused on our higher margin, lower ticket, and less cyclical Plumbing and Decorative Architectural Products segments. We also delivered on our commitments, achieving sales growth of 2 percent in local currencies and adjusted earnings per share growth from continuing operations of 6 percent, despite slower overall end markets and higher input costs for many of our products. Lastly, we continued our balanced capital allocation strategy by repurchasing 20.1 million shares for $896 million, increasing our dividend for the sixth year in a row, and reducing our debt by $201 million.”

“The fundamentals of the repair and remodel industry, which now represents approximately 90% of our business, remain strong,” continued Allman. “We believe our markets and our performance will improve throughout the year as we work through higher input costs in the first half of 2020, and we anticipate our adjusted earnings per share to be in the range of $2.35 to $2.55 per share for 2020.”

About Masco

Headquartered in Livonia, Michigan, Masco Corporation is a global leader in the design, manufacture and distribution of branded home improvement and building products. Our portfolio of industry-leading brands includes Behr® paint; Delta® and Hansgrohe® faucets, bath and shower fixtures; Kichler® decorative and outdoor lighting; and HotSpring® spas. We leverage our powerful brands across product categories, sales channels and geographies to create value for our customers and shareholders. For more information about Masco Corporation, visit www.masco.com.

The 2019 fourth quarter and full year supplemental material, including a presentation in PDF format, is available on the Company’s website at www.masco.com.

Conference Call Details

A conference call regarding items contained in this release is scheduled for Tuesday, February 11, 2020 at 8:00 a.m. ET. Participants in the call are asked to register five to ten minutes prior to the scheduled start time by dialing (855) 226-2726 (855-22MASCO) and from outside the U.S. at (706) 679-3614. Please use the conference identification number 6649309. The conference call will be webcast simultaneously and in its entirety through the Company’s website. Shareholders, media representatives and others interested in Masco may participate in the webcast by registering through the Investor Relations section on the Company’s website.

A replay of the call will be available on Masco’s website or by phone by dialing (855) 859-2056 and from outside the U.S. at (404) 537-3406. Please use the conference identification number 6649309. The telephone replay will be available approximately two hours after the end of the call and continue through March 11, 2020.

Safe Harbor Statement

This press release contains statements that reflect our views about our future performance and constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “outlook,” “believe,” “anticipate,” “appear,” “may,” “will,” “should,” “intend,” “plan,” “estimate,” “expect,” “assume,” “seek,” “forecast,” and similar references to future periods. Our views about future performance involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements. We caution you against relying on any of these forward-looking statements.

Our future performance may be affected by the levels of residential repair and remodel activity and new home construction, our ability to maintain our strong brands and reputation and to develop innovative products, our ability to maintain our competitive position in our industries, our reliance on key customers, the cost and availability of materials and the imposition of tariffs, our dependence on third-party suppliers, risks associated with our international operations and global strategies, our ability to achieve the anticipated benefits of our strategic initiatives, including the pending divestiture of our Cabinetry business, our ability to successfully execute our acquisition strategy and integrate businesses that we have and may acquire, our ability to attract, develop and retain talented personnel, risks associated with our reliance on information systems and technology, and our ability to achieve the anticipated benefits from our investments in new technology. These and other factors are discussed in detail in Item 1A "Risk Factors" of this Report. Any forward-looking statement made by us speaks only as of the date on which it was made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. Unless required by law, we undertake no obligation to update publicly any forward-looking statements as a result of new information, future events or otherwise.

MASCO CORPORATION

Condensed Consolidated Statements of Operations - Unaudited

For the Three Months and Years Ended December 31, 2019 and 2018

(in millions, except per common share data)

 

 

 

Three Months Ended
December 31,

 

Year Ended
December 31,

 

 

2019

 

2018

 

2019

 

2018

Net sales

 

$

1,639

 

 

$

1,635

 

 

$

6,707

 

 

$

6,654

 

Cost of sales

 

1,074

 

 

1,067

 

 

4,336

 

 

4,327

 

Gross profit

 

565

 

 

568

 

 

2,371

 

 

2,327

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

310

 

 

291

 

 

1,274

 

 

1,250

 

Impairment charge for other intangible assets

 

 

 

 

 

9

 

 

 

Operating profit

 

255

 

 

277

 

 

1,088

 

 

1,077

 

 

 

 

 

 

 

 

 

 

Other income (expense), net:

 

 

 

 

 

 

 

 

Interest expense

 

(40

)

 

(38

)

 

(159

)

 

(156

)

Other, net

 

2

 

 

(3

)

 

(15

)

 

(14

)

 

 

(38

)

 

(41

)

 

(174

)

 

(170

)

Income from continuing operations before income taxes

 

217

 

 

236

 

 

914

 

 

907

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

49

 

 

50

 

 

230

 

 

221

 

Income from continuing operations

 

168

 

 

186

 

 

684

 

 

686

 

 

 

 

 

 

 

 

 

 

Income from discontinued operations, net

 

295

 

 

22

 

 

296

 

 

98

 

Net income

 

463

 

 

208

 

 

980

 

 

784

 

 

 

 

 

 

 

 

 

 

Less: Net income attributable to noncontrolling interest

 

10

 

 

14

 

 

45

 

 

50

 

Net income attributable to Masco Corporation

 

$

453

 

 

$

194

 

 

$

935

 

 

$

734

 

 

 

 

 

 

 

 

 

 

Income per common share attributable to Masco Corporation (diluted):

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.56

 

 

$

0.57

 

 

$

2.20

 

 

$

2.05

 

Income from discontinued operations, net

 

1.03

 

 

0.07

 

 

1.02

 

 

0.32

 

Net income

 

$

1.59

 

 

$

0.64

 

 

$

3.22

 

 

$

2.37

 

 

 

 

 

 

 

 

 

 

Average diluted common shares outstanding

 

282

 

 

299

 

 

288

 

 

307

 

 

 

 

 

 

 

 

 

 

Amounts attributable to Masco Corporation:

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

158

 

 

$

172

 

 

$

639

 

 

$

636

 

Income from discontinued operations, net

 

295

 

 

22

 

 

296

 

 

98

 

Net income

 

$

453

 

 

$

194

 

 

$

935

 

 

$

734

 

Historical information is available on our website.

MASCO CORPORATION

Exhibit A: Reconciliations - Unaudited

For the Three Months and Years Ended December 31, 2019 and 2018

(dollars in millions)

 

 

 

Three Months Ended
December 31,

 

Year Ended
December 31,

 

 

2019

 

2018

 

2019

 

2018

Gross Profit, Selling, General and Administrative Expenses, and Operating Profit Reconciliations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

1,639

 

 

$

1,635

 

 

$

6,707

 

 

$

6,654

 

 

 

 

 

 

 

 

 

 

Gross profit, as reported

 

$

565

 

 

$

568

 

 

$

2,371

 

 

$

2,327

 

Rationalization charges

 

2

 

 

4

 

 

9

 

 

9

 

Kichler inventory step up adjustment

 

 

 

 

 

 

 

40

 

Gross profit, as adjusted

 

$

567

 

 

$

572

 

 

$

2,380

 

 

$

2,376

 

 

 

 

 

 

 

 

 

 

Gross margin, as reported

 

34.5

%

 

34.7

%

 

35.4

%

 

35.0

%

Gross margin, as adjusted

 

34.6

%

 

35.0

%

 

35.5

%

 

35.7

%

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses, as reported

 

$

310

 

 

$

291

 

 

$

1,274

 

 

$

1,250

 

Rationalization charges

 

 

 

 

 

4

 

 

 

Selling, general and administrative expenses, as adjusted

 

$

310

 

 

$

291

 

 

$

1,270

 

 

$

1,250

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses as percent of net sales, as reported

 

18.9

%

 

17.8

%

 

19.0

%

 

18.8

%

Selling, general and administrative expenses as percent of net sales, as adjusted

 

18.9

%

 

17.8

%

 

18.9

%

 

18.8

%

 

 

 

 

 

 

 

 

 

Operating profit, as reported

 

$

255

 

 

$

277

 

 

$

1,088

 

 

$

1,077

 

Rationalization charges

 

2

 

 

4

 

 

13

 

 

9

 

Kichler inventory step up adjustment

 

 

 

 

 

 

 

40

 

Impairment charge for other intangible assets

 

 

 

 

 

9

 

 

 

Operating profit, as adjusted

 

$

257

 

 

$

281

 

 

$

1,110

 

 

$

1,126

 

 

 

 

 

 

 

 

 

 

Operating margin, as reported

 

15.6

%

 

16.9

%

 

16.2

%

 

16.2

%

Operating margin, as adjusted

 

15.7

%

 

17.2

%

 

16.5

%

 

16.9

%

Historical information is available on our website.

MASCO CORPORATION

Exhibit A: Reconciliations - Unaudited

For the Three Months and Years Ended December 31, 2019 and 2018

(in millions, except per common share data)

 

 

Three Months Ended
December 31,

 

Year Ended
December 31,

 

2019

 

2018

 

2019

 

2018

Income Per Common Share Reconciliation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations before income taxes, as reported

$

217

 

 

$

236

 

 

$

914

 

 

$

907

 

Rationalization charges

2

 

 

4

 

 

13

 

 

9

 

Kichler inventory step up adjustment

 

 

 

 

 

 

40

 

Impairment charge for other intangible assets

 

 

 

 

9

 

 

 

(Gains) from private equity funds, net

 

 

(1

)

 

 

 

(1

)

(Earnings) from equity investments, net

 

 

(1

)

 

(1

)

 

(3

)

Income from continuing operations before income taxes, as adjusted

219

 

 

238

 

 

935

 

 

952

 

Tax at 26% rate

(57

)

 

(62

)

 

(243

)

 

(248

)

Less: Net income attributable to noncontrolling interest

10

 

 

14

 

 

45

 

 

50

 

Income from continuing operations, as adjusted

$

152

 

 

$

162

 

 

$

647

 

 

$

654

 

 

 

 

 

 

 

 

 

Income from continuing operations per common share, as adjusted

$

0.54

 

 

$

0.54

 

 

$

2.25

 

 

$

2.13

 

 

 

 

 

 

 

 

 

Average diluted common shares outstanding

282

 

 

299

 

 

288

 

 

307

 

Outlook for the Year Ended December 31, 2020

 

 

 

Year Ended December 31, 2020

 

 

Low End

 

High End

Income Per Common Share Reconciliation

 

 

 

 

 

 

 

 

 

Income from continuing operations per common share

 

$

2.25

 

 

$

2.45

 

Rationalization charges

 

0.02

 

 

0.02

 

Pension costs associated with expected terminated plans (1)

 

0.06

 

 

0.06

 

Allocation to participating securities per share (2)

 

0.02

 

 

0.02

 

Income from continuing operations per common share, as adjusted

 

$

2.35

 

 

$

2.55

 

(1) Represents costs associated with our qualified domestic defined-benefit pension plans that are expected to be terminated in 2021.

(2) Represents the impact of distributed dividends and undistributed earnings to unvested restricted stock awards in accordance with the two-class method of calculating earnings per share.

Historical information is available on our website.

MASCO CORPORATION

Condensed Consolidated Balance Sheets and Other Financial Data - Unaudited

December 31, 2019 and 2018

(dollars in millions)

 

 

 

December 31,
2019

 

December 31,
2018

Balance Sheet

 

 

 

 

Assets

 

 

 

 

Current Assets:

 

 

 

 

Cash and cash investments

 

$

697

 

 

$

552

 

Receivables

 

997

 

 

990

 

Inventories

 

754

 

 

798

 

Prepaid expenses and other

 

90

 

 

84

 

Assets held for sale

 

173

 

 

342

 

Total Current Assets

 

2,711

 

 

2,766

 

 

 

 

 

 

Property and equipment, net

 

878

 

 

885

 

Goodwill

 

509

 

 

511

 

Other intangible assets, net

 

259

 

 

288

 

Operating lease right-of-use assets

 

176

 

 

 

Other assets

 

139

 

 

90

 

Assets held for sale

 

355

 

 

853

 

Total Assets

 

$

5,027

 

 

$

5,393

 

 

 

 

 

 

Liabilities

 

 

 

 

Current Liabilities:

 

 

 

 

Accounts payable

 

$

697

 

 

$

736

 

Notes payable

 

2

 

 

8

 

Accrued liabilities

 

700

 

 

645

 

Liabilities held for sale

 

149

 

 

295

 

Total Current Liabilities

 

1,548

 

 

1,684

 

 

 

 

 

 

Long-term debt

 

2,771

 

 

2,971

 

Other liabilities

 

751

 

 

549

 

Liabilities held for sale

 

13

 

 

120

 

Total Liabilities

 

5,083

 

 

5,324

 

 

 

 

 

 

Equity

 

(56

)

 

69

 

Total Liabilities and Equity

 

$

5,027

 

 

$

5,393

 

 

 

As of December 31,

 

 

2019

 

2018

Other Financial Data

 

 

 

 

Working Capital Days

 

 

 

 

Receivable days

 

54

 

 

54

 

Inventory days

 

67

 

 

71

 

Payable days

 

68

 

 

69

 

Working capital

 

$

1,054

 

 

$

1,052

 

Working capital as a % of sales (LTM)

 

15.7

%

 

15.8

%

Historical information is available on our website.

MASCO CORPORATION

Condensed Consolidated Statements of Cash Flows and Other Financial Data - Unaudited

For the Years Ended December 31, 2019 and 2018

 

(dollars in millions)

 

 

 

Year Ended
December 31,

 

 

2019

 

2018

Cash Flows From (For) Operating Activities:

 

 

 

 

Cash provided by operating activities

 

$

839

 

 

$

981

 

Working capital changes

 

(6

)

 

51

 

Net cash from operating activities

 

833

 

 

1,032

 

 

 

 

 

 

Cash Flows From (For) Financing Activities:

 

 

 

 

Retirement of notes

 

(201

)

 

(114

)

Purchase of Company common stock

 

(896

)

 

(654

)

Cash dividends paid

 

(144

)

 

(134

)

Dividends paid to noncontrolling interest

 

(42

)

 

(89

)

Payment of debt

 

(8

)

 

(1

)

Debt extinguishment costs

 

(2

)

 

 

Proceeds from the exercise of stock options

 

27

 

 

14

 

Employee withholding taxes paid on stock-based compensation

 

(23

)

 

(42

)

Credit Agreement and other financing costs

 

(2

)

 

 

Net cash for financing activities

 

(1,291

)

 

(1,020

)

 

 

 

 

 

Cash Flows From (For) Investing Activities:

 

 

 

 

Capital expenditures

 

(162

)

 

(219

)

Acquisition of businesses, net of cash acquired

 

 

 

(549

)

Proceeds from disposition of businesses, net of cash disposed

 

722

 

 

 

Other, net

 

22

 

 

117

 

Net cash from (for) investing activities

 

582

 

 

(651

)

 

 

 

 

 

Effect of exchange rate changes on cash and cash investments

 

14

 

 

4

 

 

 

 

 

 

Cash and Cash Investments:

 

 

 

 

Increase (decrease) for the year

 

138

 

 

(635

)

At January 1

 

559

 

 

1,194

 

At December 31

 

$

697

 

 

$

559

 

 

 

As of

 

 

December 31,
2019

 

December 31,
2018

Liquidity

 

 

 

 

Cash and cash investments

 

$

697

 

 

$

559

 

Revolver availability

 

1,000

 

 

750

 

Total Liquidity

 

$

1,697

 

 

$

1,309

 

Historical information is available on our website.

MASCO CORPORATION

Segment Data - Unaudited

For the Three Months and Years Ended December 31, 2019 and 2018

 

(dollars in millions)

 

 

Three Months Ended
December 31,

 

 

 

Year Ended
December 31,

 

 

 

2019

 

2018

 

Change

 

2019

 

2018

 

Change

Plumbing Products

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

1,026

 

 

$

1,003

 

 

2

%

 

$

3,984

 

 

$

3,998

 

 

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

$

178

 

 

$

181

 

 

 

 

$

708

 

 

$

715

 

 

 

Operating margin, as reported

17.3

%

 

18.0

%

 

 

 

17.8

%

 

17.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

2

 

 

3

 

 

 

 

13

 

 

7

 

 

 

Accelerated depreciation related to rationalization activity

 

 

1

 

 

 

 

 

 

2

 

 

 

Operating profit, as adjusted

180

 

 

185

 

 

 

 

721

 

 

724

 

 

 

Operating margin, as adjusted

17.5

%

 

18.4

%

 

 

 

18.1

%

 

18.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

21

 

 

19

 

 

 

 

80

 

 

75

 

 

 

EBITDA, as adjusted

$

201

 

 

$

204

 

 

 

 

$

801

 

 

$

799

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Decorative Architectural Products

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

613

 

 

$

632

 

 

(3

)%

 

$

2,723

 

 

$

2,656

 

 

3

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

$

100

 

 

$

118

 

 

 

 

$

480

 

 

$

456

 

 

 

Operating margin, as reported

16.3

%

 

18.7

%

 

 

 

17.6

%

 

17.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Kichler inventory step up adjustment

 

 

 

 

 

 

 

 

40

 

 

 

Impairment charge for other intangible assets

 

 

 

 

 

 

9

 

 

 

 

 

Operating profit, as adjusted

100

 

 

118

 

 

 

 

489

 

 

496

 

 

 

Operating margin, as adjusted

16.3

%

 

18.7

%

 

 

 

18.0

%

 

18.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

10

 

 

10

 

 

 

 

41

 

 

35

 

 

 

EBITDA, as adjusted

$

110

 

 

$

128

 

 

 

 

$

530

 

 

$

531

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

1,639

 

 

$

1,635

 

 

%

 

$

6,707

 

 

$

6,654

 

 

1

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported - segment

$

278

 

 

$

299

 

 

 

 

$

1,188

 

 

$

1,171

 

 

 

General corporate expense, net

(23

)

 

(22

)

 

 

 

(100

)

 

(94

)

 

 

Operating profit, as reported

255

 

 

277

 

 

 

 

1,088

 

 

1,077

 

 

 

Operating margin, as reported

15.6

%

 

16.9

%

 

 

 

16.2

%

 

16.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges - segment

2

 

 

3

 

 

 

 

13

 

 

7

 

 

 

Accelerated depreciation related to rationalization activity - segment

 

 

1

 

 

 

 

 

 

2

 

 

 

Kichler inventory step up adjustment

 

 

 

 

 

 

 

 

40

 

 

 

Impairment charge for other intangible assets

 

 

 

 

 

 

9

 

 

 

 

 

Operating profit, as adjusted

257

 

 

281

 

 

 

 

1,110

 

 

1,126

 

 

 

Operating margin, as adjusted

15.7

%

 

17.2

%

 

 

 

16.5

%

 

16.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization - segment

31

 

 

29

 

 

 

 

121

 

 

110

 

 

 

Depreciation and amortization - non-operating

2

 

 

2

 

 

 

 

9

 

 

8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

$

290

 

 

$

312

 

 

 

 

$

1,240

 

 

$

1,244

 

 

 

Historical information is available on our website.

MASCO CORPORATION

North American and International Data - Unaudited

For the Three Months and Years Ended December 31, 2019 and 2018

 

(dollars in millions)

 

 

Three Months Ended
December 31,

 

 

 

Year Ended
December 31,

 

 

 

2019

 

2018

 

Change

 

2019

 

2018

 

Change

North American

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

1,295

 

 

$

1,279

 

 

1

%

 

$

5,328

 

 

$

5,208

 

 

2

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

$

228

 

 

$

243

 

 

 

 

$

987

 

 

$

954

 

 

 

Operating margin, as reported

17.6

%

 

19.0

%

 

 

 

18.5

%

 

18.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

2

 

 

3

 

 

 

 

13

 

 

7

 

 

 

Accelerated depreciation related to rationalization activity

 

 

1

 

 

 

 

 

 

2

 

 

 

Kichler inventory step up adjustment

 

 

 

 

 

 

 

 

40

 

 

 

Impairment charge for other intangible assets

 

 

 

 

 

 

9

 

 

 

 

 

Operating profit, as adjusted

230

 

 

247

 

 

 

 

1,009

 

 

1,003

 

 

 

Operating margin, as adjusted

17.8

%

 

19.3

%

 

 

 

18.9

%

 

19.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

20

 

 

20

 

 

 

 

81

 

 

73

 

 

 

EBITDA, as adjusted

$

250

 

 

$

267

 

 

 

 

$

1,090

 

 

$

1,076

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

International

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

344

 

 

$

356

 

 

(3

)%

 

$

1,379

 

 

$

1,446

 

 

(5

)%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

$

50

 

 

$

56

 

 

 

 

$

201

 

 

$

217

 

 

 

Operating margin, as reported

14.5

%

 

15.7

%

 

 

 

14.6

%

 

15.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

11

 

 

9

 

 

 

 

40

 

 

37

 

 

 

EBITDA

$

61

 

 

$

65

 

 

 

 

$

241

 

 

$

254

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

1,639

 

 

$

1,635

 

 

%

 

$

6,707

 

 

$

6,654

 

 

1

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported - segment

$

278

 

 

$

299

 

 

 

 

$

1,188

 

 

$

1,171

 

 

 

General corporate expense, net

(23

)

 

(22

)

 

 

 

(100

)

 

(94

)

 

 

Operating profit, as reported

255

 

 

277

 

 

 

 

1,088

 

 

1,077

 

 

 

Operating margin, as reported

15.6

%

 

16.9

%

 

 

 

16.2

%

 

16.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges - segment

2

 

 

3

 

 

 

 

13

 

 

7

 

 

 

Accelerated depreciation related to rationalization activity - segment

 

 

1

 

 

 

 

 

 

2

 

 

 

Kichler inventory step up adjustment

 

 

 

 

 

 

 

 

40

 

 

 

Impairment charge for other intangible assets

 

 

 

 

 

 

9

 

 

 

 

 

Operating profit, as adjusted

257

 

 

281

 

 

 

 

1,110

 

 

1,126

 

 

 

Operating margin, as adjusted

15.7

%

 

17.2

%

 

 

 

16.5

%

 

16.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization - segment

31

 

 

29

 

 

 

 

121

 

 

110

 

 

 

Depreciation and amortization - non-operating

2

 

 

2

 

 

 

 

9

 

 

8

 

 

 

EBITDA, as adjusted

$

290

 

 

$

312

 

 

 

 

$

1,240

 

 

$

1,244

 

 

 

Historical information is available on our website.

Contacts

Investor Contact
David Chaika
Vice President, Treasurer and Investor Relations
313.792.5500
david_chaika@mascohq.com

Contacts

Investor Contact
David Chaika
Vice President, Treasurer and Investor Relations
313.792.5500
david_chaika@mascohq.com